London and Seoul no longer so costly for expats: survey

Thu Dec 4, 2008 6:06am EST
 
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By Susan Fenton

HONG KONG (Reuters) - Volatile exchange rates stemming from the global financial crisis mean London and Seoul are no longer among the top 10 most expensive locations for expatriates, while Japanese cities have returned to upper end of the league table, a survey showed on Thursday.

London is now ranked 72nd in the global listing of expat locations while Seoul takes 90th place following their currencies' sharp depreciation in the past year.

Angola's capital Luanda remains the costliest place for foreigners. That is mainly because certain items and brands typically required by expatriates are not readily available and therefore very expensive, according to the survey by London-based ECA International, which advises companies globally on international assignments.

The survey compares a basket of 125 consumer goods and services commonly purchased by expatriates in more than 370 locations worldwide.

Moscow has replaced Oslo as Europe's most costly location while a strong yen has made Tokyo the second-most expensive city in the world, up from 13th position a year ago.

A 48 percent depreciation in the South Korean won means goods and services in Seoul -- which a year ago were 5 percent more expensive than in Tokyo -- are now 40 percent cheaper than prices in the Japanese capital, ECA said.

Such sharp currency swings create a challenge for companies remunerating expat packages, most of which are based on an expat's home currency, says ECA.

"Companies which split pay between the employee's home and host countries will be much better equipped to ride out the current currency volatility," said Lee Quane, Asia general manager of ECA International.   Continued...

 
<p>A general view of the London skyline with the London Eye, February 9, 2008. REUTERS/Luke MacGregor</p>